Draper Fisher Jurvetson led the consortium of seven Chinese and foreign investors. According to a report on the Chinese Web site www.chinabyte.com.cn, the consortium has invested close to $100m. The report also quotes unidentified sources as saying it will be the last round of funding before Baidu lists shares.
Robin Li, Baidu’s chief executive, confirmed reports that Google was among foreign investors included in the fund-raising, but refused to say how much was raised or how many shares the investors hold.
Baidu was formed in 1999 and raised $1.2m during its first round of financing and $10m during its second round. Its business has burgeoned since it launched a search service in 2001. It quotes local research figures that says Baidu accounts for over 48% of searches made by Chinese internet users, with Google occupying second place with just under 30%. Yahoo Inc’s subsidiary 3721.com accounts for 13%.
Baidu offers the world’s largest Chinese web page index comprised of over 220 million pages. The company also offers a pay-for-performance search, which allows businesses to be prominently displayed in search results by bidding for key words. This service has grown to support 35,000 businesses.
The Chinese market already has 80 million internet users and is growing rapidly as the roll-out of broadband into homes and the growth of internet cafes continues.
